Paper #359

Títol:

Surviving in a competitive spatial market: The threshold capture model

Autors:

Daniel Serra, Charles Revelle i Ken Rosing

Data:

Febrer 1999

Resum:

Most facility location decision models ignore the fact that for a facility to survive it needs a minimum demand level to cover costs. In this paper we present a decision model for a firm that wishes to enter a spatial market where there are several competitors already located. This market is such that for each outlet there is a demand threshold level that has to be achieved in order to survive. The firm wishes to know where to locate its outlets so as to maximize its market share taking into account the threshold level. It may happen that due to this new entrance, some competitors will not be able to meet the threshold and therefore will disappear. A formulation is presented together with a heuristic solution method and computational experience.

Paraules clau:

Discrete facility location, threshold, competitive location

Codis JEL:

C61, R12, R53

Àrea de Recerca:

Gestió de la Producció i de les Operacions

Publicat a:

Journal of Regional Science, 39, 4, (1999), pp. 637-652

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